Why Do I Have to Deal with People Like Dan Mitchell?

If Cato wouldn't employ people like Dan Mitchell, they would be a much better thinktank. Just saying.

A semi-random ten:

December 5, 2008: The Fallacy That Government Creates Jobs: Keynesian theory sounds good, and it would be nice if it made sense, but it has a rather glaring logical fallacy. It overlooks the fact that, in the real world, government can't inject money into the economy without first taking money out of the economy. More specifically, the theory only looks at one-half of the equation — the part where government puts money in the economy's right pocket. But where does the government get that money? It borrows it, which means it comes out of the economy's left pocket. There is no increase in what Keynesians refer to as aggregate demand. Keynesianism doesn't boost national income, it merely redistributes it. The pie is sliced differently, but it's not any bigger...

April 167, 2003: A Better Way to Chastise France: Yes, folks, it finally happened. French President Jacques Chirac swallowed his pride and placed a let's-be-friends-again phone call to President Bush. As well he should have. France's behavior regarding Iraq has been despicable.... Unfortunately, the French people may be just as misguided as their leaders. French vandals recently desecrated the graves of allied soldiers.... The French people certainly have a right to their opinions, even if they conveniently forget that they are able to exercise that right only because of the sacrifices made by American soldiers. But that doesn't mean France shouldn't suffer any consequences. Many Americans, for instance, are boycotting French products or canceling plans to vacation in France. These are fine gestures...

October 7, 2004: An OPEC for Politicians?: At the risk of stating the obvious, the United Nations hasn’t been America’s friend in recent years. It has obstructed the war on terrorism. It has honored corrupt dictatorships with seats on its Human Rights Commission. Its budget is riddled with waste and fraud, and the United States pays the lion’s share of the tab. And it serves as a platform for anti-American rhetoric -- much of it from governments that receive U.S. foreign aid. But this situation may be about to get worse. Led by France and Brazil, the United Nations now wants to impose global taxes. At a recent U.N. summit meeting, politicians from more than 100 nations endorsed a $50 billion global tax to finance even more foreign aid. Not surprisingly, the bureaucrats have many different schemes to fleece the world’s taxpayers. One of the most popular ideas is a tax on financial transactions...

October 14, 2008: Who Are the Villains of the Mortgage Mess?: [T]he Community Reinvestment Act: Politicians imposed numerous regulatory burdens on financial institutions, but "affordable lending" requirements such as those imposed as a result of the Community Reinvestment Act were among the most perverse. In effect, banks were extorted into making loans to people who were not credit worthy. This added to the bubble and expanded systemic risk. It's also worth noting that poor people were victimized by this government policy, because many of them were lured into houses they could not afford. Culprits: President Carter presumably deserves some of the blame because many of these policies were first imposed during his dismal reign, primarily with support from Democrats...

January 24, 2001: The Greatest Threat to Our Economy: What's the greatest threat to our economy?... the Internal Revenue Service. Why? Because the IRS has two new regulations.... The first mistake occurred when the agency implemented "Qualified Intermediary" regulations... require foreign financial institutions that are investing client money in America to reveal the identity of individual investors. The IRS claims this is necessary to prevent American taxpayers from anonymously investing here in order to take advantage of the favorable tax treatment provided to foreign investors.... [I]t is highly unlikely that the IRS will catch any Americans trying to avoid or evade taxes. Not because there aren't any, but because they aren't stupid. If an American has money in an offshore account and is investing in the United States, he easily can avoid the QI regulations by shifting investments to other countries...

March 1, 2001: Tax Cuts Won't Harm Social Security: Foes of President Bush’s tax-cut plan are getting desperate. They haven’t reached the point of claiming that tax cuts cause cancer and road rage, but they’re close. Depending on the day of the week, we’re told that cuts will cause inflation, encourage deficits, help only the rich, or hurt the economy. One of the more imaginative claims is that tax cuts somehow will prevent lawmakers from saving Social Security. President Bush’s 10-year, $1.6 trillion tax cut, we are told, will soak up the surplus and leave no money to reform the government pension program. A clever argument, yes, but with one small problem: It’s not true. According to the independent Congressional Budget Office, the projected surplus over the next 10 years is $5.6 trillion. It doesn’t take a math major to figure out that a $1.6 trillion tax cut is small compared to all the extra tax money that will roll into Washington...

August 21, 2001: A One-World Taxing Authority?: It is bad news when politicians in Washington make us pay taxes, but just imagine how high taxes would climb if unaccountable international bureaucracies had that power. Yet this is a big part of the U.N.'s agenda. Specifically, the report highlights two options. The first is a tax on all international currency transactions, a proposal that would throw a monkey wrench in the world trading system and impose a disproportionate burden on America's efficient financial markets. The second option is an energy tax. This idea would mean higher gas prices, higher electricity prices, and higher heating oil prices...

October 5, 2001: Don't Scapegoat Tax Havens: Contrary to the impression given by John Grisham novels and Hollywood movies, "tax havens" aren't tropical paradises filled with people carrying cash-filled suitcases. That's why lawmakers need to make sure they have the right answers to the following questions before they allow misguided proposals to creep into law under an anti-terrorism banner. What are tax havens? A tax haven is a country with tax rates low enough to attract foreign investors.... Why do some politicians hate tax havens? Because they offer an escape hatch for oppressed taxpayers. French taxpayers bring their money to Switzerland; German taxpayers bring their money to Luxembourg.... [T]ax havens don't help high-tax governments collect tax revenue. They assert, quite correctly, that they're not obligated to put the tax laws of other nations above their own and that high-tax nations don't have a right to tax income earned inside the borders of low-tax countries...

May 2, 2002: Bad Tax Policy: You Can Run?: The worst Supreme Court decision of all time?... Dred Scott... in which the Supreme Court ruled that slaves did not gain freedom by escaping to non-slave states. Instead, they were considered property and had to be returned to their "owners." Some U.S. companies soon may be treated in a similar manner, thanks to legislation being touted by Sens. Max Baucus, D-Mont., and Charles Grassley, R-Iowa...

March 21, 2007: Iceland Comes in From the Cold With Flat Tax Revolution: Listen up, Gordon Brown and George Osborne. Iceland has joined a growing list of nations that have sharply cut their corporate tax rates and adopted flat-rate individual income taxes, with hugely positive consequences on economic performance.... The reduction in the top tax rates was introduced to cut penalties on productive activities.... All these reforms have helped Iceland climb from 26th to ninth in the "Economic Freedom of the World" rankings since 1990.... Tax reform and economic liberalisation have helped Iceland prosper. Let's hope that other industrial nations – and especially Brown and Osborne – will learn from Iceland's success...

There are conservative economists who are intelligent. There also are conservative economists who--like Milton Friedman--understand that the velocity of money is interest-elastic, are not xenophobic and jingoistic, are not in the pockets of the world's money launderers, understand that a reliance on hot money-fueled economic growth creates instability, are not shills for the oil companies, are able to use their fingers and toes to accurately assess the U.S. federal budget, and don't falsely blame the financial crisis on feckless poor Black people who can't pay their mortgages and the government that forced banks to lend to them.

Comments

Why Do I Have to Deal with People Like Dan Mitchell?

If Cato wouldn't employ people like Dan Mitchell, they would be a much better thinktank. Just saying.

A semi-random ten:

December 5, 2008: The Fallacy That Government Creates Jobs: Keynesian theory sounds good, and it would be nice if it made sense, but it has a rather glaring logical fallacy. It overlooks the fact that, in the real world, government can't inject money into the economy without first taking money out of the economy. More specifically, the theory only looks at one-half of the equation — the part where government puts money in the economy's right pocket. But where does the government get that money? It borrows it, which means it comes out of the economy's left pocket. There is no increase in what Keynesians refer to as aggregate demand. Keynesianism doesn't boost national income, it merely redistributes it. The pie is sliced differently, but it's not any bigger...

April 167, 2003: A Better Way to Chastise France: Yes, folks, it finally happened. French President Jacques Chirac swallowed his pride and placed a let's-be-friends-again phone call to President Bush. As well he should have. France's behavior regarding Iraq has been despicable.... Unfortunately, the French people may be just as misguided as their leaders. French vandals recently desecrated the graves of allied soldiers.... The French people certainly have a right to their opinions, even if they conveniently forget that they are able to exercise that right only because of the sacrifices made by American soldiers. But that doesn't mean France shouldn't suffer any consequences. Many Americans, for instance, are boycotting French products or canceling plans to vacation in France. These are fine gestures...

October 7, 2004: An OPEC for Politicians?: At the risk of stating the obvious, the United Nations hasn’t been America’s friend in recent years. It has obstructed the war on terrorism. It has honored corrupt dictatorships with seats on its Human Rights Commission. Its budget is riddled with waste and fraud, and the United States pays the lion’s share of the tab. And it serves as a platform for anti-American rhetoric -- much of it from governments that receive U.S. foreign aid. But this situation may be about to get worse. Led by France and Brazil, the United Nations now wants to impose global taxes. At a recent U.N. summit meeting, politicians from more than 100 nations endorsed a $50 billion global tax to finance even more foreign aid. Not surprisingly, the bureaucrats have many different schemes to fleece the world’s taxpayers. One of the most popular ideas is a tax on financial transactions...

October 14, 2008: Who Are the Villains of the Mortgage Mess?: [T]he Community Reinvestment Act: Politicians imposed numerous regulatory burdens on financial institutions, but "affordable lending" requirements such as those imposed as a result of the Community Reinvestment Act were among the most perverse. In effect, banks were extorted into making loans to people who were not credit worthy. This added to the bubble and expanded systemic risk. It's also worth noting that poor people were victimized by this government policy, because many of them were lured into houses they could not afford. Culprits: President Carter presumably deserves some of the blame because many of these policies were first imposed during his dismal reign, primarily with support from Democrats...

January 24, 2001: The Greatest Threat to Our Economy: What's the greatest threat to our economy?... the Internal Revenue Service. Why? Because the IRS has two new regulations.... The first mistake occurred when the agency implemented "Qualified Intermediary" regulations... require foreign financial institutions that are investing client money in America to reveal the identity of individual investors. The IRS claims this is necessary to prevent American taxpayers from anonymously investing here in order to take advantage of the favorable tax treatment provided to foreign investors.... [I]t is highly unlikely that the IRS will catch any Americans trying to avoid or evade taxes. Not because there aren't any, but because they aren't stupid. If an American has money in an offshore account and is investing in the United States, he easily can avoid the QI regulations by shifting investments to other countries...

March 1, 2001: Tax Cuts Won't Harm Social Security: Foes of President Bush’s tax-cut plan are getting desperate. They haven’t reached the point of claiming that tax cuts cause cancer and road rage, but they’re close. Depending on the day of the week, we’re told that cuts will cause inflation, encourage deficits, help only the rich, or hurt the economy. One of the more imaginative claims is that tax cuts somehow will prevent lawmakers from saving Social Security. President Bush’s 10-year, $1.6 trillion tax cut, we are told, will soak up the surplus and leave no money to reform the government pension program. A clever argument, yes, but with one small problem: It’s not true. According to the independent Congressional Budget Office, the projected surplus over the next 10 years is $5.6 trillion. It doesn’t take a math major to figure out that a $1.6 trillion tax cut is small compared to all the extra tax money that will roll into Washington...

August 21, 2001: A One-World Taxing Authority?: It is bad news when politicians in Washington make us pay taxes, but just imagine how high taxes would climb if unaccountable international bureaucracies had that power. Yet this is a big part of the U.N.'s agenda. Specifically, the report highlights two options. The first is a tax on all international currency transactions, a proposal that would throw a monkey wrench in the world trading system and impose a disproportionate burden on America's efficient financial markets. The second option is an energy tax. This idea would mean higher gas prices, higher electricity prices, and higher heating oil prices...

October 5, 2001: Don't Scapegoat Tax Havens: Contrary to the impression given by John Grisham novels and Hollywood movies, "tax havens" aren't tropical paradises filled with people carrying cash-filled suitcases. That's why lawmakers need to make sure they have the right answers to the following questions before they allow misguided proposals to creep into law under an anti-terrorism banner. What are tax havens? A tax haven is a country with tax rates low enough to attract foreign investors.... Why do some politicians hate tax havens? Because they offer an escape hatch for oppressed taxpayers. French taxpayers bring their money to Switzerland; German taxpayers bring their money to Luxembourg.... [T]ax havens don't help high-tax governments collect tax revenue. They assert, quite correctly, that they're not obligated to put the tax laws of other nations above their own and that high-tax nations don't have a right to tax income earned inside the borders of low-tax countries...

May 2, 2002: Bad Tax Policy: You Can Run?: The worst Supreme Court decision of all time?... Dred Scott... in which the Supreme Court ruled that slaves did not gain freedom by escaping to non-slave states. Instead, they were considered property and had to be returned to their "owners." Some U.S. companies soon may be treated in a similar manner, thanks to legislation being touted by Sens. Max Baucus, D-Mont., and Charles Grassley, R-Iowa...

March 21, 2007: Iceland Comes in From the Cold With Flat Tax Revolution: Listen up, Gordon Brown and George Osborne. Iceland has joined a growing list of nations that have sharply cut their corporate tax rates and adopted flat-rate individual income taxes, with hugely positive consequences on economic performance.... The reduction in the top tax rates was introduced to cut penalties on productive activities.... All these reforms have helped Iceland climb from 26th to ninth in the "Economic Freedom of the World" rankings since 1990.... Tax reform and economic liberalisation have helped Iceland prosper. Let's hope that other industrial nations – and especially Brown and Osborne – will learn from Iceland's success...

There are conservative economists who are intelligent. There also are conservative economists who--like Milton Friedman--understand that the velocity of money is interest-elastic, are not xenophobic and jingoistic, are not in the pockets of the world's money launderers, understand that a reliance on hot money-fueled economic growth creates instability, are not shills for the oil companies, are able to use their fingers and toes to accurately assess the U.S. federal budget, and don't falsely blame the financial crisis on feckless poor Black people who can't pay their mortgages and the government that forced banks to lend to them.

The Most-Recent Thirty

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We Are with Her!

Looking Forward to Four Years During Which Most if Not All of America's Potential for Human Progress Is Likely to Be Wasted

With each passing day Donald Trump looks more and more like Silvio Berlusconi: bunga-bunga governance, with a number of unlikely and unforeseen disasters and a major drag on the country--except in states where his policies are neutralized.

Nevertheless, remember: WE ARE WITH HER!

Definitely Worth Reading...

Blogging: What to Expect Here

The purpose of this weblog is to be the best possible portal into what I am thinking, what I am reading, what I think about what I am reading, and what other smart people think about what I am reading...

"Bring expertise, bring a willingness to learn, bring good humor, bring a desire to improve the world—and also bring a low tolerance for lies and bullshit..." — Brad DeLong

"I have never subscribed to the notion that someone can unilaterally impose an obligation of confidentiality onto me simply by sending me an unsolicited letter—or an email..." — Patrick Nielsen Hayden

"I can safely say that I have learned more than I ever would have imagined doing this.... I also have a much better sense of how the public views what we do. Every economist should have to sell ideas to the public once in awhile and listen to what they say. There's a lot to learn..." — Mark Thoma

"Tone, engagement, cooperation, taking an interest in what others are saying, how the other commenters are reacting, the overall health of the conversation, and whether you're being a bore..." — Teresa Nielsen Hayden

"With the arrival of Web logging... my invisible college is paradise squared, for an academic at least. Plus, web logging is an excellent procrastination tool.... Plus, every legitimate economist who has worked in government has left swearing to do everything possible to raise the level of debate and to communicate with a mass audience.... Web logging is a promising way to do that..." — Brad DeLong

"Blogs are an outlet for unexpurgated, unreviewed, and occasionally unprofessional musings.... At Chicago, I found that some of my colleagues overestimated the time and effort I put into my blog—which led them to overestimate lost opportunities for scholarship. Other colleagues maintained that they never read blogs—and yet, without fail, they come into my office once every two weeks to talk about a post of mine..." — Daniel Drezner